Iran attacks expose security gaps, fuel regional tension

Members of Iranian forces take cover during an attack on the Iranian parliament in central Tehran, Iran, June 7, 2017. Tasnim News Agency/Handout via REUTERS

By Parisa Hafezi

ANKARA (Reuters) – When Islamic State called on members of Iran’s Sunni Muslim minority in March to wage a religious war on their Shi’ite rulers, few people took the threat seriously. And yet within three months, militants have breached security at the very heart of the nation, killing at least 17 people.

This week’s attacks at parliament and the mausoleum of the Islamic Republic’s founder Ayatollah Ruhollah Khomeini have exposed shortcomings among the Revolutionary Guards Corps (IRGC) which was supposed to be protecting these potent symbols of Iran’s revolution.

They have also undermined Tehran’s belief that by backing offensives against Islamic State across the Middle East, it can keep the militant Sunni group away from Iran.

Undaunted, officials say Iran will step up the strategy, which includes sending fighters to battle Islamic State in Syria and Iraq alongside allied Shi’ite militia groups.

And with Supreme Leader Ayatollah Ali Khamenei and the IRGC blaming Saudi Arabia for the attacks, tensions are only likely to deepen between the two arch rivals competing for influence in an already chaotic region. Riyadh denies the charges, describing Tehran instead as “the number one state sponsor of terrorism”.

Wednesday’s killings in Tehran by Iranian members of Islamic State drew a shocked response similar to that in Western countries when they too have been attacked by locally-born jihadists. Now Iranians are worrying about how many others are out there, planning similar assaults.

One senior Iranian official told Reuters that Islamic State had established a network of support in the country, and suggested that members’ motivation was as much political and economic as to do with Sunni radicals’ belief that Shi’ites are infidels.

“Sunni extremism is spreading in Iran like many other countries. And not all of these young people who join extremist groups are necessarily religious people,” said the official, who asked not to be named. “But the establishment is well aware of the problem and is trying to tackle it.”

Most Iranian Sunnis, who form up to 10 percent of the population, reject Islamic State’s ideology. But some young Sunnis seem to regard policies of Shi’ite-led Iran as oppressive at home or aggressive abroad, such as in Iraq and Syria, pushing more of them into the arms of jihadist groups.

Iran has been trying to stem the spread of radicalism into Sunni majority regions, which are usually less economically developed. Authorities said 1,500 young Iranians were prevented from joining Islamic State in 2016.

Iran’s Sistan and Baluchestan province, which borders Pakistan and Afghanistan, is home to the Balouch minority and has long been a hotbed of Sunni insurgents.

Two Sunni groups, Jaish al-Adl and Jundallah, have been fighting the IRGC for over a decade. This has mostly been in remote areas but some say it was almost inevitable that violence would eventually spread to Tehran, as it did this week.

“It’s not the attacks that are surprising. It’s that Iran has been able to avoid one for so long. The attacks were a wake-up call for Iran’s security apparatus,” said senior Iran analyst Ali Vaez of the International Crisis Group. “But so too will they probably serve as one for jihadists, who will be encouraged to exploit Iran’s vulnerabilities.”

“STRATEGIC FOLLY”

Since its creation shortly after the 1979 Islamic revolution, the IRGC has functioned as Iran’s most powerful internal and external security force, with a sophisticated intelligence and surveillance network.

The IRGC has vowed revenge on Islamic State – known by its opponents under the Arab acronym of Daesh – but a top security official said this won’t be easy.

“The attacks showed the vulnerability of our security system, at the borders and within Iran,” the official said, asking not to be named. However, he added: “Many planned attacks by Daesh have been foiled by our security forces in the past years. Many terrorist cells were dismantled. Our Guards have been vigilant.”

Syrian rebels and Iraqi forces are closing in on Islamic State in those countries, and the official said the group appeared to have tried to strike back in Tehran.

“The attacks are the result of Daesh being weakened in the region. They blame Iran for that … But Iran will not abandon its fight against terrorism,” he added.

Open discussion of security vulnerabilities is taboo in Iran. However, Behnam Ben Taleblu, a senior Iran analyst at the Washington-based Foundation for Defense of Democracies, criticized the idea that Syria and Iraq could form an effective first line of defense for Iran.

“Iranian officials have long justified their country’s active military presence in Iraq and Syria as a way to keep the homeland safe,” he said. “Wednesday’s attacks expose the folly of that strategy.”

SPIRALING TENSIONS

A senior official, who also asked not to be named, said the attacks would push Iran toward “a harsher regional policy”.

Sanam Vakil, associate fellow with Chatham House’s Middle East and North Africa Programme, dismissed any expectation that Tehran might try to ease spiraling tensions with Riyadh. “If we are expecting to see any change in Iran’s regional policy or a retreat in any way – that is not going to happen,” she said.

Newly re-elected President Hassan Rouhani has said the attacks will make Iran more united. Analysts, however, believe they will exacerbate domestic tensions between Rouhani, a pragmatist, and his rivals among hardline clergy and the IRGC.

They have repeatedly criticized Rouhani’s attempts to improve relations with the outside world.

Rouhani has generally lost out to the hardliners, who through the IRGC’s Al Quds force – expeditionary units which are fighting in Iraq and Syria as well as organizing Shi’ite allies – continue to call the shots. In the view of the hardliners’ critics, they are helping to drive alienated Sunnis toward militant groups.

(Additional reporting by Jonathan Saul in London, Writing by Parisa Hafezi; Editing by Samia Nakhoul and David Stamp)

U.S., Russia discuss de-escalation zone for southwest Syria: diplomats

A Free Syrian Army fighter takes a position in the eastern part of the rebel-held town of Dael in Deraa Governorate, Syria, June 8, 2017. REUTERS/Alaa Al-Faqir

By Suleiman Al-Khalidi

AMMAN (Reuters) – The United States and Russia are quietly holding talks on creating a “de-escalation zone” in southwestern Syria, Western diplomats and regional officials said, but could face fierce opposition from Iran.

The Russian and U.S. special envoys for Syria, Alexander Lavrentiev and Michael Ratney, and other officials have met at least twice in the Jordanian capital Amman in the past two weeks and will talk again soon, the officials and diplomats said.

The talks are at an early stage of discussing the boundaries of the proposed de-escalation zone in Deraa province, on the border with Jordan, and Quneitra, which borders the Israeli-occupied Golan Heights, they said.

Diplomats say the talks could represent a major new attempt by Washington and Moscow, Syria’s main foreign backer, to reach an understanding on how to end six years of conflict which the Syrian Observatory for Human Rights, a Britain-based war monitor, estimates has killed close to half a million people.

Iran, Russia and Turkey brokered a deal in the Kazakh capital, Astana, in May to create four de-escalation zones in Syria. But the United States wants no role in the southwest, Russia’s ally in the war, the diplomats said.

Washington has misgivings about the Astana talks and wants to forge a bilateral understanding with Moscow in an area of strategic interest to the United States and its allies, Jordan and Israel.

“The Americans are talking to the Russians and proposing a deconfliction zone outside the Astana process without the Iranians and their proxies,” said one senior diplomat.

The United States is proposing a de-escalation zone covering areas held by both rebel and government forces that could eventually turn into a safe area, the envoys and officials said.

“The two sides are in the process of drafting its borders… and which outside forces will be on the ground. But there are many flaws on how to implement it,” said a regional intelligence official who is familiar with the talks but is not authorized to speak publicly.

Time may be of the essence. Lebanon’s Hezbollah, which is supported by Iran, is expanding its foothold in the southwest and dozens of raids this week by the Syrian army and new troop deployments by Hezbollah in Deraa city were intended to pre-empt or wreck any agreement, a Western intelligence source said.

The Kremlin and the Russian Foreign Ministry did not immediately respond to requests for comment.

A U.S. State Department official said: “We have nothing to announce regarding reports of discussions about southern Syria. The United States remains committed to supporting a diplomatic resolution to the Syrian conflict, one which can bring about a more representative and peaceful Syria, free of terrorism.”

U.S. MISTRUST OF IRAN

Under the Astana accord, de-escalation was envisaged as the halt of hostilities between government forces and opposition groups and the creation of conditions for humanitarian access, medical assistance, the return of displaced civilians to their homes and restoration of damaged infrastructure.

Safe zones should be guaranteed by all parties to a conflict.

U.S. officials have told the Russian negotiators that the Syrian army and Iranian-backed troops are exploiting the Astana agreement to free up additional troops for other battles, the source familiar with the negotiations said.

The United States has taken a tough stance against Tehran under President Donald Trump. But Iran and allied militias are integral to groups supporting Syrian President Bashar al-Assad.

Although Trump has voiced support for safe zones in Syria, Washington opposes Iran’s involvement as a guarantor of the de-escalation zones set out in the Astana accord, and regards Assad’s track record in upholding previous agreements as poor.

In the talks with Moscow, Washington has proposed a halt in military offensives by Western-vetted rebels who control swathes of Deraa and Quneitra, a regional intelligence official said. Jordan’s role in the deal is important because of its leverage over rebels in that area.

Deraa and Quneitra are home to tens of thousands of people and form a center of the insurgency against Assad. They are a potential launchpad for rebel attacks on the Syrian capital Damascus, 40 miles (64 km) to the north.

U.S. enthusiasm to push the deal depends on Russia forcing the Iran-backed militias to leave the area. “Iran and its proxies have to be out of this zone. This is key to the deal being proposed,” he said.

Regional tensions are on the rise and the warfare in southern Syria has worsened, pitting Western-backed rebels around the Tanf base near the border with Iraq against Syria’s army and militias backed by Iran.

There are doubts in the West that Russia can rein in the growing involvement in the region of Iran and its allies, two senior diplomats familiar with the talks said.

There are other difficulties. Jordan wants a deal that keeps the Deraa front quiet and eases the plight of civilians under the threat of army bombardment. But it has rejected a Russian proposal for its troops to police the proposed de-confliction zone, another regional source said.

(Additional reporting by Tom Perry in Beirut, Maria Tsvetkova in Moscow and Yeganeh Torbati in Washington, Editing by Timothy Heritage)

Iran’s Khamenei says attacks to increase hatred toward U.S., Saudi: TV

FILE PHOTO: Iran's Supreme Leader Ayatollah Ali Khamenei delivers a speech in Tehran, Iran, June 4, 2017. TIMA via REUTERS

ANKARA (Reuters) – Iran’s Supreme Leader Ayatollah Ali Khamenei said on Friday attacks in Tehran by Islamic State that killed at least 17 people will increase hatred toward the United States and Saudi Arabia, state TV reported.

Suicide bombers and gunmen attacked the Iranian parliament and Ayatollah Khomeini’s mausoleum in Tehran on Wednesday. Scores of people were wounded.

“It will not damage our nation’s determination to fight terrorism … but will only increase hatred for the governments of the United States and their stooges in the region like Saudis,” Khamenei said in a message read at the funeral of victims of the attacks.

Islamic State claimed responsibility for the attacks and threatened more against Iran’s majority Shi’ite population, seen by the hardline Sunni militants as heretics.

Iranian authorities said on Thursday five of the attackers were Iranian nationals recruited by Islamic State to carry out the assaults inside the tightly controlled Shi’ite Iran.

Iran’s powerful Revolutionary Guards Corps blamed the assault on regional rival Saudi Arabia and has threatened revenge. Sunni Saudi Arabia denied any involvement in the attacks.

The assaults have further fueled tension between Riyadh and Tehran as they vie for control of the Gulf and influence in the wider Islamic world.

Iran is one of the powers leading the fight against Islamic State forces in Iraq and Syria.

(Writing by Parisa Hafezi; Editing by Janet Lawrence)

Iran attackers fought for Islamic State in Syria, Iraq: ministry

Members of Iranian forces take position during an attack on the Iranian parliament in central Tehran, Iran, June 7, 2017. Omid Vahabzadeh/TIMA

ANKARA (Reuters) – Iran said on Thursday that gunmen and bombers who attacked Tehran were Iranian members of Islamic State who had fought in the militants’ strongholds in Syria and Iraq – deepening the regional ramifications of the assaults.

The attackers raided Iran’s parliament and Ayatollah Khomeini’s mausoleum on Wednesday morning, in a rare strike at the heart of the Islamic Republic. Authorities said the death count had risen to 17 and scores were wounded.

Iran’s powerful Revolutionary Guards have also said regional rival Saudi Arabia was involved, further fuelling tensions between Sunni Muslim power Riyadh and Shi’ite power Tehran as they vie for influence in the Gulf. Saudi Arabia dismissed the accusation.

Iran’s intelligence ministry said on Thursday five of the attackers who died in the assault had been identified as Iranians who had joined the hardline Sunni Muslim militants of Islamic State on its main battlegrounds in Iraq and Syria.

“They earlier left Iran and were involved in the crimes of the terrorist group in Raqqa and Mosul,” the ministry said, referring to Islamic State’s effective capital in Syria and a city it captured in Iraq.

“Last year, they returned to Iran … to carry out terrorist attacks in the holy cities of Iran,” the ministry added in a statement on state news agency IRNA.

The attacks were the first claimed by Islamic State inside the tightly controlled country, one of the powers leading the fight against the militants in neighboring Iraq and beyond that Syria.

Islamic State claimed responsibility and threatened more attacks against Iran’s majority Shi’ite population, seen by the hardline Sunni militants as heretics.

Iran’s intelligence ministry said earlier on Thursday it had arrested more suspects linked to the attacks, on top of six Iranians, including one woman, detained on Wednesday.

Militant attacks are rare in Tehran and other major cities although two Sunni militant groups, Jaish al-Adl and Jundallah, have been waging a deadly insurgency, mostly in remote areas, for almost a decade.

(Writing by Parisa Hafezi; Editing by Andrew Heavens)

Attackers bomb Iran parliament and mausoleum, at least 12 dead: Iranian media

Members of Iranian forces take cover during an attack on the Iranian parliament in central Tehran, Iran, June 7, 2017. Tasnim News Agency/Handout via REUTERS

By Bozorgmehr Sharafedin

LONDON (Reuters) – Suicide bombers and gunmen attacked Iran’s parliament and the Mausoleum of Ayatollah Khomeini in Tehran on Wednesday morning, killing at least 12 people in a twin assault at the heart of the Islamic Republic, Iranian officials and media said.

Islamic State claimed responsibility and released a video purporting to show gunmen inside the parliament building and one man, who appeared wounded, on the floor.

The rare attacks were the first claimed by the hardline Sunni Muslim militant group inside the Shi’ite Muslim country. Iran is one of the powers leading the fight against Islamic State militants in neighbouring Iraq and, beyond that, Syria.

Attackers dressed as women burst through parliament’s main entrance in central Tehran, deputy interior minister Mohammad Hossein Zolfaghari said, according to the semi-official Tasnim news agency.

“One of them was shot dead and another one detonated his suicide vest,” he said.

About five hours after the first reports, Iranian news agencies said four people who had attacked parliament were dead and the incident was over.

At least 12 people were killed by the attackers, the head of Iran’s emergency department, Pir-Hossein Kolivand, was quoted as saying by state broadcaster IRIB.

“I was inside the parliament when shooting happened. Everyone was shocked and scared. I saw two men shooting randomly,” said one journalist at the scene, who asked not to be named.

Soon after the assault on parliament, another bomber detonated a suicide vest near the shrine of the Republic’s revered founder, Ayatollah Khomeini, a few kilometres south of the city, Zolfaghari said, according to Tasnim.

A second attacker was shot dead, he said.

Members of Iranian forces take cover during an attack on the Iranian parliament in central Tehran, Iran, June 7, 2017. Tasnim News Agency/Handout via REUTERS

Members of Iranian forces take cover during an attack on the Iranian parliament in central Tehran, Iran, June 7, 2017. Tasnim News Agency/Handout via REUTERS

THIRD ATTACK FOILED – MINISTRY

The Intelligence Ministry said security forces had arrested another “terrorist team” planning a third attack, without giving further details.

The attacks took place less than a month after the re-election of President Hassan Rouhani, a moderate, whose landslide victory defeated candidates supported by the hardline clergy and the Islamic Revolutionary Guard Corps (IRGC), which is responsible for national security.

“The atmosphere is tense. It is a blow to Rouhani. How can four armed men enter the parliament, where a very tight security has always been in place,” said a senior official, who asked not to be named.

The Intelligence Ministry called on people to be vigilant and report any suspicious movement. Despite unconfirmed reports of a hostage situation, state television said parliament had resumed, and broadcast footage of what it said was the opening session proceeding normally.

“Some coward terrorists infiltrated one of the buildings of parliament. They were confronted. It was not a major issue. Our security forces have taken necessary steps,” parliament speaker Ali Larijani said in an open session broadcast live by state TV.

Attacks are highly rare in Tehran and other major cities though a Sunni militant group named Jundallah and its splinter group Ansar al Furqan have been waging a deadly insurgency, mostly in more remote areas, for almost a decade.

Iran’s restive Sistan and Baluchestan province, in the southeast on the borders with Pakistan and Afghanistan, is home to the Balouch minority and has long been a hotbed of Sunni insurgents fighting the Shi’ite-led Islamic Republic.

Last year Iranian authorities said they had foiled a plot by Sunni militants to bomb targets in Tehran and other cities during the Muslim holy month of Ramadan.

Islamic State has often urged its fighters to attack Iranian targets and lambasted “heretic” Shi’ite Iran for helping the Syrian and Iraqi governments battle Islamic State, which considers Shi’ites to be infidels.

The video released by Islamic State’s news agency Amaq included an audio track of a man saying: “Oh God, thank you. [Gunshots]. Do you think we will leave? No! We will remain, God willing.”

A boy is evacuated during an attack on the Iranian parliament in central Tehran, Iran, June 7, 2017. Omid Vahabzadeh/TIMA via REUTERS

A boy is evacuated during an attack on the Iranian parliament in central Tehran, Iran, June 7, 2017. Omid Vahabzadeh/TIMA via REUTERS

(Writing and additional reporting by Parisa Hafezi; Editing by Andrew Heavens)

U.S. hikes ‘combat power’ in Syria, with eye on Iran-backed militia

A copy of leaflets, with English-language translation, that were dropped by the U.S. military in southern Syria in recent days to advise Iran-backed forces to depart an area near a garrison used by U.S. and U.S.-backed forces as tensions mount are shown in this handout provided June 1, 2017. Courtesy U.S. Defense Department/Handout via REUTERS

By Phil Stewart

WASHINGTON (Reuters) – The U.S. military said on Thursday it had bolstered its “combat power” in southern Syria, warning that it viewed Iran-backed fighters in the area as a threat to nearby coalition troops fighting Islamic State.

The remarks by a Baghdad-based spokesman for the U.S.-led coalition battling Islamic State was the latest sign of tension in the region, where the United States has forces at the base around the Syrian town of At Tanf supporting local fighters.

“We have increased our presence and our footprint and prepared for any threat that is presented by the pro-regime forces,” said the spokesman, U.S. Army Colonel Ryan Dillon, referring to Iran-backed forces supporting Syrian President Bashar al-Assad.

Dillon estimated that a small number of Iran-backed forces had remained inside a so-called “deconfliction” zone meant to ensure the safety of U.S.-led coalition forces since a May 18 U.S. strike on their advancing formation.

Meanwhile, a larger number had been massing directly outside the zone, which was agreed between the United States and Russia, which is supporting Assad.

“We see that as a threat,” Dillon said.

The U.S. military has also dropped about 90,000 leaflets this week warning the fighters inside the zone to depart, one U.S. official said. Reuters had previously reported on the leaflet drop, citing Hammurabi Justice, a website linked to U.S.-backed Syrian rebel forces known as the Maghawir al Thwra group.

A copy of the leaflets provided to Reuters by the Pentagon told the Iran-backed fighters that any movement toward the At Tanf garrison “will be seen as hostile intent and we will defend our forces.”

“You are within an established deconfliction zone, leave the area immediately,” another read.

This southeastern area of the Syrian desert, known as the Badia, has become an important front in Syria’s civil war between Assad, backed by Iran and Shi’ite militias, and rebels seeking to oust him.

They are competing to capture land held by Islamic State, which is retreating as it comes under intense attack in Iraq and along Syria’s Euphrates basin.

Western-backed Syrian rebels said on Wednesday that Russian jets attacked them as they tried to advance against Iran-backed militias.

U.S.-backed rebels took Tanf from Islamic State last year, and regional intelligence sources say they mean to use it as a launchpad to capture Bukamal, a town on Syria’s border with Iraq and an important jihadist supply route.

The coalition’s presence in Tanf, on the Damascus-Baghdad highway, was also meant to stop Iran-backed groups from opening an overland route between Iraq and Syria, the sources say.

Damascus has declared the Badia and Deir al-Zor priorities in its campaign to re-establish control over Syria, which has been shattered by six years of a war that has killed hundreds of thousands of people.

(Reporting by Phil Stewart; Editing by Jonathan Oatis)

Tested on all fronts, Iran’s Rouhani may struggle on reforms

FILE PHOTO: Supporters of Iran's President Hassan Rouhani take part in a campaign rally in Tehran, Iran, May 17, 2017. Picture taken May 17, 2017. TIMA via REUTERS/File Photo

By Parisa Hafezi and Jonathan Saul

ANKARA/LONDON (Reuters) – Growing strains with the United States and political infighting at home threaten Iranian President Hassan Rouhani’s plans to expand social freedoms, create jobs and draw in foreign investment, officials and analysts say.

Anti-Western hardliners defeated by Rouhani in the presidential election in May appear determined to take revenge by denying the pragmatic cleric an economic dividend, they believe.

The hardliners’ strategy is to stoke already-simmering tension with Washington and its Gulf Arab allies, injecting fresh political risk into a country that had been seen as a safer bet since its 2015 nuclear deal with world powers.

“To weaken Rouhani, they will try all possible ways, from provoking hawks in Washington to imposing more political limitations at home … and isolating Iran economically,” said a senior official who asked not to be named.

“Rouhani will have very challenging months ahead.”

U.S. President Donald Trump, during a May 20-21 visit to Saudi Arabia, called Iran a threat to countries across the Middle East.

Rouhani later urged “moderation and rationality” in international relations. But Iran’s hardline Supreme Leader Ayatollah Ali Khamenei struck a more combative note, saying Saudi Arabia’s leaders faced “certain downfall” due to their alliance with Washington.

A week later the Islamic Revolutionary Guard Corps (IRGC), the Shi’ite country’s most powerful military force, upped the ante, disclosing it had built a third underground ballistic missile production factory and would keep developing its missile program – a project strongly opposed by Washington and its Gulf allies like Saudi Arabia.

TURMOIL ACROSS MIDDLE EAST

In recent months, the Guards have stepped up support for the rebel Houthi movement in Yemen, where they are waging a proxy war with Sunni Muslim Saudi Arabia. They have increased funding and arming of militia groups in Syria and Iraq, while continuing to back traditional ally Hezbollah of Lebanon.

IRGC naval vessels have repeatedly been in tense encounters with U.S. warships in the Gulf and Strait of Hormuz, through which a third of all oil shipping passes.

The escalating regional tensions will increase the nervousness of potential foreign investors, many of whom were already keeping Iranian ambitions on hold due to worries about red tape or a possible restoration of sanctions if Iran violates the nuclear deal.

“Rouhani will continue to solicit the return of foreign businesses … to Iran without providing them with a much-needed change in behavior to boost their confidence,” said senior Iran analyst Behnam Ben Taleblu of the Washington-based Foundation for Defense of Democracies.

Karim Sadjadpour, a senior fellow at the Carnegie Endowment, said that with the anti-Iran Trump in the White House there was less pressure on Iran’s hardliners to justify their animosity toward the U.S.

“Iran’s regional strategy has been consistent for four decades, regardless of who is president of the country. Opposition to the U.S. and Israel hasn’t changed, and opposition to Saudi Arabia has intensified,” he said.

The lifting of sanctions in 2016 partly reconnected Iran with the international financial system crucial to trade, but lingering unilateral U.S. sanctions tied to human rights and terrorism have spooked many potential investors.

“Large international banks won’t (get involved) because of the U.S. exposure, the size of the past penalties and their ongoing U.S. business and assets,” said Andreas Schweitzer, senior managing partner of London-based Arjan Capital.

Then there are the domestic tensions.

First elected in 2013 on a pledge to ease Iran’s diplomatic isolation, Rouhani spent much of his political capital on the nuclear deal, which resulted in a lifting of most sanctions in return for curbs on Tehran’s nuclear program.In that effort, he enjoyed the guarded support of Khamenei. But now, under heightened pressure in his second term to widen economic opportunities for Iran’s youth, Rouhani can no longer be sure of the supreme leader’s backing.

After a campaign featuring outspoken attacks on security and judicial hardliners and calling for a speedier opening to the world, Rouhani trounced Khamenei’s perceived favorite in the election, irking the IRGC, Khamenei’s ally.

COLLISION PATH

Andrine Skjelland, MENA country risk analyst, BMI Research, said the president’s rhetoric had deepened “divisions between himself and the hardline elite”.

Sidelined by the nuclear deal, the Guards are trying to claw back economic clout by accusing Rouhani of favoring foreign firms over domestic ones, praising Khamenei’s vision of a self-reliant economy that avoids foreign investment.

“Domestic political instability will impact foreign investors … It will deter the investors from returning to Iran,” said Meir Javdanfar, an Iranian-born expert on Iran at the Interdisciplinary Center Herzliya in Israel.

Under U.S. and EU sanctions, the Guards took over billion-dollar projects vacated by Western oil companies.

Their influence can be felt across Iran’s economy – from port operations to oil. They are estimated to have a presence in 80 percent of business interests in the country.

“Rouhani’s re-election will put the IRGC on a bigger collision path with him,” Javdanfar said. “His voters wanted moderation, while the IRGC wants to expand its reach abroad and to become more confrontational with the West.”

Senior members of the IRGC and its front companies remain under U.S. sanctions. Most IRGC front companies, however, are not formally owned by the Corps, but by firms linked to it.

Foreign companies need an Iranian partner to do business in Iran, which for big projects often means IRGC-controlled firms.

“Many businessmen are still suffering from the lack of an economic revival in Iran. They will happily accept being the IRGC’s shell companies,” said a trader in Tehran.

Khamenei has been adept at ensuring that no group, even among hardline allies, becomes powerful enough to challenge his authority. Displeased with Rouhani’s rising popularity, he will not back the president in his economic battle with the IRGC.

“It is a vicious circle. More economic involvement of the Guards means less foreign investors and vice versa,” said a former reformist minister.

(Editing by William Maclean and Andrew Roche)

Putin says U.S. missile systems in Alaska, South Korea challenge Russia

Russian President Vladimir Putin speaks during a meeting with representatives of international news agencies in St. Petersburg, Russia, June 1, 2017.

By Denis Pinchuk and Andrew Osborn

ST PETERSBURG/MOSCOW (Reuters) – Russian President Vladimir Putin said on Thursday that elements of a U.S. anti-missile system in Alaska and South Korea were a challenge to Russia and that Moscow had no choice but to build up its own forces in response.

Putin, speaking at an economic forum in St Petersburg, said Russia could not stand idly by and watch while others increased their military capabilities along its borders in the Far East in the same way as he said had been done in Europe.

Participants attend a session of the St. Petersburg International Economic Forum (SPIEF), Russia, June 1, 2017. REUTERS/Sergei

Participants attend a session of the St. Petersburg International Economic Forum (SPIEF), Russia, June 1, 2017. REUTERS/Sergei Karpukhin

He said Moscow was particularly alarmed by the deployment of the U.S. THAAD anti-missile system to South Korea to counter a North Korean missile threat and to reported U.S. plans to beef up Fort Greely in Alaska, a launch site for anti-ballistic missiles.

“This destroys the strategic balance in the world,” Putin told a meeting with international media, the start of which was broadcast on state TV.

“What is happening is a very serious and alarming process. In Alaska, and now in South Korea, elements of the anti-missile defence system are emerging. Should we just stand idly by and watch this? Of course not. We are thinking about how to respond to these challenges. This is a challenge for us.”

Washington was using North Korea as a pretext to expand its military infrastructure in Asia in the same way it had used Iran as a pretext to develop a missile shield in Europe, charged Putin.

RUSSIAN RESPONSE

Putin said the Kurile Islands, a chain of islands in the Far East where Moscow and Tokyo have rival territorial claims, were “quite a convenient place” to deploy Russian military hardware to respond to such threats.

Defence Minister Sergei Shoigu said last year Russia planned to deploy some of its newest missile defence systems and drones to the islands, part of a drive to rearm military units already stationed there. He has also spoken of Russia building a military base there.

“I don’t agree that we are unilaterally starting to militarize these islands,” said Putin. “It is simply a forced response to what is happening in the region.” Any talk of demilitarizing the islands could only occur once tensions in the entire region had been reduced, he said.

Tokyo and Moscow have long been locked in talks over the contested islands, known as the Northern Territories in Japan. Putin said Russia was alive to the danger that Japan might allow U.S. troops to deploy there if it struck a deal to hand over some of the islands to Tokyo’s jurisdiction.

“Such a possibility exists,” said Putin.

Russia did not want to worsen already poor relations with Washington by fueling what he described as an arms race, but Putin said the United States was still consumed by what he called an anti-Russian campaign.

“How will the situation develop? We don’t know,” said Putin.

(Additional reporting by Dmitry Solovyov and Maria Kiselyova; Writing by Andrew Osborn; Editing by Alexander Winning)

Syrian rebels say U.S., allies sending more arms to fend off Iran threat

FILE PHOTO: Popular Mobilization Forces (PMF) ride on a tank during a battle with Islamic State militants, at Um Jaris village on the Iraqi border with Syria, Iraq May 29, 2017. REUTERS/Stringer/File Photo

By Tom Perry, Suleiman Al-Khalidi and Maher Chmaytelli

BEIRUT/AMMAN/BAGHDAD (Reuters) – Syrian rebels say the United States and its allies are sending them more arms to try to fend off a new push into the southeast by Iran-backed militias aiming to open an overland supply route between Iraq and Syria.

The stakes are high as Iran seeks to secure its influence from Tehran to Beirut in a “Shi’ite crescent” of Iranian influence through Iraq, Syria and Lebanon, where Sunni Arab states have lost out in power struggles with Iran.

Tensions escalated in the southeastern region of Syria, known as the Badia, this month when government forces supported by Iraqi Shi’ite militias deployed in a challenge to rebels backed by President Bashar al-Assad’s enemies.

This has coincided with a march toward the Syrian border by Shi’ite militias from Iraq. They reached the frontier adjoining northern Syria on Monday. A top Iraqi militia commander said a wider operation to take the area from Sunni jihadist Islamic State would start on Tuesday and this would help Syria’s army.

While in Iraq the United States has fought alongside Iranian-backed Iraqi government forces and Shi’ite militias against Islamic State, in Syria Washington has lined up against Assad’s Iranian-backed government and wants to block a further expansion of Iranian influence, with its regional allies.

The sides are vying for pole position in the next major phase of the fight against Islamic State: the battle to dislodge it from the eastern Syrian province of Deir al-Zor where many of the jihadists have relocated from Raqqa and Mosul.

Several rebel groups fighting under the Free Syrian Army (FSA) banner operate in the sparsely populated Badia, where they captured swathes of territory from Islamic State this year. U.S. air strikes on May 18 targeted Iran-backed fighters who had moved into the area.

Also in May, Damascus declared both the Badia and Deir al-Zor priorities of its campaign to re-establish its rule over Syria, which has been shattered by six years of war that have killed hundreds of thousands of people. The government is being helped by both Iran and Russia, while the opposition has been helped by the West and regional states which oppose Assad.

Rebels said military aid has been boosted through two separate channels: a program backed by the U.S. Central Intelligence Agency (CIA), known as the MOC, and regional states including Jordan and Saudi Arabia, and one run by the Pentagon.

“There has been an increase in the support,” said Tlass Salameh, head of the Jaish Usoud al-Sharqiya, one of the FSA groups backed via the CIA-backed program. “There’s no way we can let them open the Baghdad-Damascus highway,” he said.

A senior commander of a Pentagon-backed group, Maghawir al-Thawra, told Reuters a steady flow of weapons had arrived at their base near the Iraqi border since the pro-Damascus forces began deploying this month.

He said efforts to recruit and train local fighters from Deir al-Zor had accelerated at their garrison at Tanf, on the highway some 20 km (12 miles) from the Iraqi border.

“The equipment and reinforcements come and go daily … but in the last few weeks they have brought in more heavy military vehicles, TOW (missiles), and armored vehicles,” he said, speaking on condition of anonymity.

Two armored vehicles newly delivered to the Tanf garrison were shown in photos sent to Reuters from a rebel source. A video showed fighters unpacking mortar bombs.

In a written response to emailed questions from Reuters, a spokesman for the U.S.-led coalition did not say if coalition support to Maghawir al-Thawra had increased.

Colonel Ryan Dillon said coalition forces were “prepared to defend themselves if pro-regime forces refuse to vacate” a de-confliction zone around Tanf.

“The coalition has observed pro-regime forces patrolling in the vicinity of the established de-confliction zone around the Tanf training site in Syria … Pro-regime patrols and the continued armed and hostile presence of forces inside the … zone is unacceptable and threatening to coalition forces.”

U.S. jets this week dropped leaflets on pro-government forces instructing them to pull out of the Tanf area to the Zaza junction further from the border. The leaflets were obtained by Hammurabi Justice, a Maghawir-linked website.

The Syrian army could not be reached for comment.

A commander in the military alliance fighting in support of Assad told Reuters the deployment of government forces and pro-Damascus Iraqi fighters in the Badia would “obstruct all the plans of the MOC, Jordan and America”.

The commander, a non-Syrian, said Assad’s enemies were committed to blocking “what they call the (Shi’ite) Crescent”. But, he said, “Now, our axis is insistent on this matter and it will be accomplished.”

The Iraqi Badr militia said its advance to the Syrian border would help the Syrian army reach the border from the other side. “The Americans will not be allowed to control the border,” its leader, Hadi al-Amiri, told al-Mayadeen TV.

(Additional reporting by Laila Bassam in Beirut; Writing by Tom Perry; Editing by Louise Ireland)

Iran-backed Iraqi force says takes Islamic State villages near Syria

By Maher Chmaytelli

BAGHDAD (Reuters) – An Iraqi Shi’ite force backed by Iran said it pushed Islamic State out of several villages on the border with Syria on Monday, potentially reopening a supply route to send Iranian weapons to President Bashar al-Assad.

The maneuver could also be the prelude to a connection with the Assad’s Iranian-backed forces, although they are yet to reach the Iraqi border from the Syrian side.

Syrian rebel sources have warned of advances by the Syrian army and Iranian-backed militia to reach the border.

The territory taken by the Popular Mobilisation force on Monday is located north of the Islamic State-held town of Baaj.

For Popular Mobilisation, it is a step towards achieving a linkup with Assad forces, giving him a significant advantage in fighting the six-year rebellion against his rule.

But the territory is connected with land held by U.S.-backed Syrian Kurdish groups on the Syrian side, who are more focused on fighting Islamic State than Assad.

It is not known whether the Syrian Kurds would allow the Iraqi Shi’ite force to use their territory to reach Assad’s troops, deployed further south and further west.

In a statement on its website, Popular Mobilisation described its advance to the border with Syria as “a Ramadan miracle”, referring to the Muslim fasting month which started over the weekend.

Popular Mobilisation is taking part in the U.S-backed Iraqi campaign to defeat Islamic State in the city of Mosul and the surrounding province of Nineveh.

Iraqi government armed forces are focusing their effort on dislodging insurgents from the city of Mosul, Islamic State’s de-facto capital in Iraq.

While reporting nominally to Iraq’s Shi’ite-led government, Popular Mobilisation has Iranian military advisers, one of whom died last week fighting near Baaj.

MOSUL CAMPAIGN

Iran has helped to train and organize thousands of Shi’ite militia fighters from Iraq, Afghanistan and Pakistan in the Syrian conflict. Fighters from Lebanon’s Hezbollah are also working closely with Iranian military commanders in Syria.

Eight months into the Mosul campaign, Islamic State fighters have been dislodged from all of the city except an enclave by the western bank of the Tigris river.

Iraq’s army on Saturday launched a new offensive to take the militants’ enclave, which includes the densely populated Old City, amid concern over the fate of the civilians trapped there.

Up to 200,000 people still live behind Islamic State lines in Mosul, struggling to get food, water and medicine, U.N. Humanitarian Coordinator Lise Grande told Reuters.

Government forces have been dropping leaflets over the districts telling families to flee, but many have remained out of fear of getting caught in the crossfire.

“We have been informed by authorities that the evacuation is not compulsory … If civilians decide to stay … they will be protected by Iraqi security forces,” said Grande.

“People who choose to flee will be directed to safe routes. The location of these will change depending on which areas are under attack and dynamics on the battlefield,” she added.

“The fighting is extremely intense,” a government advisor told Reuters. “The presence of civilians means we have to be very cautious,” he said, speaking on condition of anonymity, explaining the slow progress of the campaign.

(Reporting by Maher Chmaytelli; Editing by Tom Heneghan)